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Abstract

The re-use of organizational practices in multiple locations is a fundamental way MNCs leverage knowledge to seek competitive advantage. Scholars approaching the issue of adaptation from both a market and an institutional perspective argue that, in order to achieve fit with the local environment, some degree of adaptation is advisable with the need for adaptation increasing as the institutional distance between source and recipient locations increases. However, arguments to date have examined the effect of adaptation primarily on a subsidiary's long term performance. A necessary precursor is to understand the effect of adaptation on the transfer process itself as transfer difficulty, or stickiness, may preclude the re-use of an organizational practice in the first place. In this paper, we explore how the adaptation of organizational practices affects the stickiness of a cross border transfer. We use structural equation modeling to analyze data from 122 internal transfers of best-practice. Contrary to expectation we find that adaptation significantly increases, rather than decreases, the stickiness of cross-border knowledge transfer.